Antitrust Enforcement in Health Care: Increased Scrutiny Likely After DOJ Withdraws Policy Statements

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The Department of Justice (DOJ) recently withdrew three longstanding health care focused antitrust enforcement policy statements that had provided certain “safety zones” for mergers, joint ventures, group purchasing, and information sharing among industry participants.

Without these safety zones, regulators will likely increase antitrust scrutiny of dealings between health care industry players. They also may question previously sanctioned practices, especially around information sharing between hospitals, provider groups, payors, ACOs, and other health care delivery participants.

Health care companies should work with experienced antitrust counsel to assess how their practices will fare under new antitrust scrutiny, regardless of technical compliance with the now withdrawn safety zones.

What was withdrawn?

The DOJ withdrew the following policy statements:

What prompted the withdrawals?

The DOJ called the statements “overly permissive” as a result of significant changes in the health care industry. Assistant Attorney General Jonathan Kanter referred to the guidance as “out-of-date” and said the withdrawal was “long overdue” to ensure “enforcement efforts reflect modern market realities.” Doha Mekki, Principal Deputy Assistant Attorney General of the DOJ’s Antitrust Division, noted that “new technologies or other changes in market realities have altered the competitive value of different types of data” which made the “traditional guideposts . . . unhelpful” in assessing the potential competitive harm of certain information exchanges.

Like other recent antitrust policy withdrawals by both the FTC and DOJ, the DOJ did not indicate a plan to replace the guidance. Instead, it said a case-by-case approach would help it “better evaluate mergers and conduct in health care markets that may harm competition.”

The withdrawals are consistent with the Biden Administration’s heightened concerns about anticompetitive information-sharing in other contexts, such as through overlapping directorships, private equity portfolio companies, or using a third party to disseminate sensitive information.

How will this affect health care industry participants?

  • Expect increased antitrust scrutiny and enforcement around information-sharing, even through third parties, and uncertainty about the evolving standards for enforcement on a wide variety of common practices in health care.
  • Withdrawing the policies does not mean regulators will necessarily see conduct that once fell into a safety zone as anticompetitive. It does mean the health care industry cannot rely on the now withdrawn safety zones to provide a safe harbor and should instead conduct a more holistic assessment of how their practices would hold up to antitrust scrutiny.

What should companies do?

Organizations should go back to the basics when assessing the antitrust risk of any arrangement. They should analyze the likely effects, both good and bad, of an arrangement on competition. Organizations should also:

  • Remain vigilant regarding information sharing of competitively sensitive information:

    • Historically, antitrust enforcers have worried that sharing competitively sensitive information will lead to price-fixing agreements or other anticompetitive effects.
    • Competitively sensitive information includes pricing and salary information, costs, outputs, strategic plans (including future product offerings and expansion plans), and customer-specific information.
    • Organizations must consider (and document) how potential information exchanges have procompetitive benefits and do not allow competitors to improperly coordinate prices, costs, or wages.
  • Review antitrust policies and practices, including to ensure they do not rely on withdrawn safety zones, and do the same for industry organizations in which they participate.
  • Reinforce antitrust training.
  • Assess risk for information sharing policies and arrangements, especially those that involve benchmarking surveys and industry groups that collect and distribute non-public data using third parties.

    • Make sure third parties have appropriate policies and procedures.
    • Consider the number of participants and whether technology (including algorithms) can counter precautions taken to anonymize data.
    • Consider whether data shared with participants is sufficiently historical given the nature of the industry, product, or service.
    • Limit the distribution of information obtained through information exchanges to fit the procompetitive purpose.
    • Consider and document how potential information exchanges are reasonably necessary to achieve procompetitive benefits. Take steps to avoid sharing information in ways that could be used improperly to coordinate on prices, costs, or wages.
  • Assess how the company participates in group purchasing activities.
  • Seek counsel when considering new joint ventures, collaborations, information sharing arrangements, or any collaborations with competitors.

Further Details on the Three Withdrawn Policies

When the Department of Justice and FTC Antitrust Enforcement Policy Statements in the Health Care Area was announced in 1993, it was meant to resolve uncertainties and decrease health care costs by allowing deals and conduct that would create efficiencies.  The original policy addressed antitrust enforcement regarding mergers and other joint activities among health care providers in six areas—expanding to nine areas in the 1996 updated policy.

Specifically, these policies addressed: (1) Mergers Among Hospitals, (2) Hospital Joint Ventures Involving High Technology Or Other Expensive Health Care Equipment, (3) Hospital Joint Ventures Involving Specialized Clinical Or Other Expensive Health Care Services, (4) Providers’ Collective Provision Of Non-Fee-Related Information To Purchasers Of Health Care Services, (5) Providers’ Collective Provision Of Fee-Related Information To Purchasers Of Health Care Services, (6) Provider Participation In Exchanges Of Price And Cost Information, (7) Joint Purchasing Arrangements Among Health Care Providers, (8) Physician Network Joint Ventures, and (9) Multiprovider Networks. For most of the nine areas, the policies provided antitrust “safety zones” which set forth circumstances where the DOJ and FTC would not, absent extraordinary circumstances, challenge conduct under the antitrust laws.

Two widely relied upon “safety zones” involved information sharing and group purchasing:

  • The policies recognized a now withdrawn safety zone for information shared through third parties, including benchmarking surveys, consultants, and industry trade associations, where (1) the data collection is managed by a third party; (2) the information provided by participants is based on data more than three months old; and (3) there are at least five participants reporting data upon which each shared statistic is based, no individual participant’s data represents more than 25 percent on a weighted basis of that statistic, and any information shared with the participants is aggregated so one cannot identify the prices charged or compensation paid by any participant.
  • The policies provided a safety zone for joint purchasing arrangements where “(1) the purchases account for less than 35 percent of the total sales of the purchased product or service in the relevant market; and (2) the cost of the products and services purchased jointly accounts for less than 20 percent of the total revenues from all products or services sold by each competing participant in the joint purchasing arrangement.”

The 1993 and 1996 policies also set forth the frameworks for review of conduct outside the safety zones.

Similarly, the now withdrawn 2011 policy statement addressed conduct around the formation of accountable care organizations, or ACOs, under the 2010 Affordable Care Act’s Medicare Shared Savings Program, which enabled providers to work together. The policy set forth a safety zone for ACO participants with a combined share under 30 percent for each common service in each participant’s primary service area.


Even with the withdrawals, organizations can still reduce most antitrust risks by sharing only historical, sufficiently aggregated competitively sensitive information through independent third parties as opposed to directly with competitors. To mitigate the new enforcement risks, however, health care organizations also need to consider the specific circumstances of the participants and technology involved in any information-exchange.